Özet:

In this globalized era of competitive financial markets, winning over the confidence of investors and retaining existing shareholders is a difficult task for any company. To sustain itself in this competitive market the company must strive for value creation. Shareholder wealth depends on the intrinsic value of companies (Rappaport, 1998). Among the various financial performance metrics of the companies, Return on Equity (ROE) is a closely-watched measure among the different stakeholders of the companies. The study uses Return on Equity (ROE) as a measure of intrinsic value to decode ROE into its value drivers and identifies the value drivers that contribute significantly to enhancing ROE. Adopting secondary data methodology, the top 100 companies of the Bombay Stock Exchange in terms of their market capitalization consistently for a period of eight years ranging from 2015 to 2022 are identified as consistent wealth creators. Using the SPSS software, panel data regression with a fixed effect model, the impact of the value drivers on the ROE is quantified. The study concludes with the important value drivers contributing significantly to value creation by wealth creators.

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